Assembly passes Walker's property tax cut

MADISON, Wis. — The Wisconsin Assembly, on a broad bipartisan vote Thursday, approved a $100 million property tax cut a week after Gov. Scott Walker proposed it, clearing the way for it to be signed into law by the end of the week.

The measure sped through the Legislature with little opposition, allowing for the cut to be applied to tax bills mailed to homeowners in December. The amount of the cut will vary widely across the state but for the typical homeowner it will amount to just $13 this year and $20 next year.

Even under the cut, property taxes are still projected to increase by $11 — from $2,943 to $2,954 — in two years for the median-valued $148,000 home.

Walker and Republican backers defended the cut, as modest as it may be, as the right thing to do given the state's growing budget surplus.

“It is outstanding to see Republicans and Democrats in the Assembly come together, like their colleagues in the Senate, to pass meaningful property tax relief for Wisconsin families, farmers, seniors, and small businesses,” Walker said in a statement. He planned to sign it into law Sunday in Burlington.

While most Democrats voted for the bill, even those who ultimately supported it argued it was nothing more than a political ploy and would provide little significant tax relief.

Walker introduced the tax cut plan just three days after Democrat Mary Burke announced her campaign for governor.

Democratic Assembly Minority Leader Peter Barca called it an “interesting coincidence” that Walker introduced the tax cut so close to Burke getting into the race. He proposed an alternative property tax cut plan that he said would be better for the middle class. That was rejected.

“The middle class deserves better than what is in front of us,” Barca said.

Democrats said the plan was hastily put together and not well-thought out.

“What we're doing here is not serious tax policy reform,” said Democratic state Rep. Melissa Sargent, of Madison, who voted against the bill.

But Republicans said taxpayers would appreciate the cut, no matter the size.

“We all know at the end of the day homeowners deserve the break and that's what we're going to give them today,” said Republican Assembly Speaker Robin Vos.

The Assembly passed the bill 82-12, with 26 Democrats joining all 56 present Republicans voting for it. It passed the Senate 28-5, with 10 Democrats for it and five against.

The tax cut, along with other bills before the Legislature, would result in a projected $725 million budget shortfall heading into the 2015 two-year budget. That is 33 percent higher than the previous estimate of $545 million, but less than half of the average structural deficit dating back to 1997.

Vos dismissed concerns about the growth in the projected shortfall, saying that would be plugged with as little as 1 percent growth in state tax collections. On Monday Walker's administration released a report showing state tax collections were $89 million more than previously expected for the budget year ending in June.

Under the property tax proposal, the $100 million would be funneled through the state aid formula for schools, which are mostly funded from the state and local property tax revenue. But without a requisite increase in schools' spending authority, the money would instead go toward lowering local property taxes.